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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (51436)	5/14/2002 4:28:59 PM
From: stockman_scott	Respond to of 65232

Dollar Shines in the Glitter of Rally By Eric Burroughs Tuesday May 14, 4:05 pm Eastern Time NEW YORK (Reuters) - Rallying for a second straight day, the dollar soared against major currencies on Tuesday, jumping 1 percent against the euro as a rally in Wall Street stocks and a surge in U.S. April retail sales spurred hope for a solid U.S. economic recovery. The greenback started rebounding on Monday, riding the coattails of a stock market rally that lifted the blue-chip Dow Jones index above the 10,000 level. An unexpectedly strong report on U.S. retail sales on Tuesday fueled further gains in both stocks and the dollar. The technology-heavy Nasdaq index (NasdaqSC:^IXIC - News) soared 4 percent while the Dow Jones index (CBOT:^DJI - News) was up nearly 2 percent, helping the dollar find its feet after suffering for several week from investors' concerns about the unsteady pace of the U.S. recovery from recession. Corporate profits are being closely tracked for any evidence of a rebound that could spur capital spending, what Federal Reserve officials and many economists view as essential to secure a solid recovery. Through early May the dollar had shed about 4 percent against major currencies on a trade-weighted basis in just a month, but in the past week it has climbed 1.3 percent. Still, analysts refused to say the dollar's days in the doldrums are over. With U.S. industrial production data due on Wednesday and consumer sentiment data due later in the week, some analysts remained skeptical of the dollar's reversal. "(Retail sales) show there's a little more resilience (in the U.S. economy) than we had been thinking in recent days. It's more of a validation of the U.S. dollar rally of the past couple of sessions rather than a green light for significant further gains," said Sean Callow, currency strategist at IDEAGlobal. "For now, caution is the order of the day," he said. Technical analysts, however, expected the euro to retreat further in coming sessions, with support at 90.10 cents possibly giving way to a fall to around 89.95 cents. Resistance on any rebound would come at 90.35 cents to 90.50 cents. The euro was pinned near session lows around 90.20 cents (EUR=), well below seven-month highs it hit last week at 91.89 cents. June euros sagged to a 12-day low of $0.8998 in the wake of the retail sales data. Technical analysts remained bearish on the contract. "I could see it going down toward the 200-day moving average around $0.8905," said Tom Pawlicki, financial futures analyst at Refco. "I think it's going hold there and rally again." Against the yen, the dollar was around 128.55 yen (JPY=), up 0.60 percent from the previous U.S. close, but off session highs at 128.80 yen. June yen tumbled to a three-session low of $0.007777. Support was at $0.007839, Monday's low, Pawlicki said. Resistance was at $0.007901, a 38 percent Fibonacci retracement for the September 2001 to February 2002 downtrend. Overnight, Japan's top financial diplomat, Haruhiko Kuroda, repeated a verbal threat against excessive yen strength, saying it is important that currency rates should reflect fundamentals and that the Finance Ministry is watching the market closely. Moody's Investors Service said on Tuesday it would conclude its review on Japan by the end of May, dampening speculation of an imminent ratings cut. GOOD DATA, POOR DATA The euro also slid lower after German economic research institute ZEW said its expectations indicator fell 4.3 points to 66.3 in May, casting further doubt on the sustainability of the recovery in Europe's biggest economy. Spreading German strikes -- the first major labor unrest in the country in seven years -- has also dealt the euro a blow in the past week. Meanwhile, the European Central Bank warned of increased inflationary risks as news of accelerating price rises in April in euro zone countries -- Spain and Netherlands being the latest -- boosted the chances of an early interest rate hike. "The euro has a lot of mud to wade through at the moment, the three main negatives being the IG Metall strike, signs of growing inflation risks in the euro zone and the threat of a rightward shift in Dutch politics after Wednesday's elections," said Steve Barrow, currency strategist at Bear Stearns. By contrast, the U.S. government reported the biggest rise in retail sales in six months, providing hopes that robust consumer spending, which powers two-thirds of the U.S. economy, will boost corporate profits. Sales surged 1.2 percent in April, well above forecasts of a 0.7 percent rise. biz.yahoo.com

To: Jim Willie CB who wrote (51436)	5/14/2002 5:18:01 PM
From: stockman_scott	Respond to of 65232

Some BULLish comments on silver... Message 17464095

To: Jim Willie CB who wrote (51436)	5/14/2002 6:57:46 PM
From: stockman_scott	Read Replies (1) \| Respond to of 65232

Dollar Advances Against All Its Major Rivals Because of Strong U.S. Economic Data Associated Press Tuesday May 14, 6:23 pm Eastern Time NEW YORK (AP) -- The dollar advanced against all its major rivals Tuesday with confidence in the U.S. currency enhanced by stronger-than-expected U.S. economic data and a continuing rally in major stock indexes. A 1.2% increase in U.S. retail sales for April gave the dollar further momentum in New York, taking the euro to lows of the day at 90.12 cents and pushing dollar/yen as high as 128.79. Overall, the dollar was able to make across-the-board gains of about 1%, with the recently strong Swiss franc taking a hit as dealers backed away from risk-averse strategies. In late New York trading the dollar was quoted at 1.6151 Swiss francs, up from 1.5949 late Monday. "There's a nice combination of a strong stock market and a growing U.S. economy, and that's contributing strongly to the dollar," said Ashraf Laidi, chief currency analyst at MG Financial in New York. U.S. equities have continued to give the dollar solid support, rallying again Tuesday on the back of strong gains Monday. At the close in New York, the Dow Jones Industrial Average was up about 189 points, after Monday's 170-point gain. Analysts say that the dollar's gains are as much a product of the lack of convincing alternatives as on its own merits. "Anybody who looks at the euro can't get too comfortable with a long euro position," said Andrew Busch, director of foreign exchange at Bank of Montreal in Chicago. In late New York trading, the euro was quoted at 90.25 cents, down from 91.20 cents late Monday. The yen lost ground to the dollar all day, initially falling in Tokyo trading as the market digested reports that ratings agency Moody's Investors Service has sent a letter to Japan's Ministry of Finance, responding to a request that it clarify its ratings decisions. The timing was seen as significant, as Moody's had been expected to announce a downgrade of Japanese debt by at least one notch Monday. However, that key decision has now been rescheduled to May 31. In late New York trading, the dollar was quoted at 128.59 yen, up from 127.70 yen late Monday. Also Tuesday, a top official of Japan's Ministry of Finance again underlined the MOF's desire to see a weaker yen. "Looking at the fundamentals there is absolutely no reason for the yen to strengthen," said Haruhiko Kuroda, vice finance minister for international affairs. In late New York trading the British pound was quoted at $1.4492, down from $1.4571 late Monday. The U.S. dollar traded at 1.5584 Canadian dollars, up from 1.5559. biz.yahoo.com